WONGA borrowers will soon be able to claim compensation for mis-sold or unaffordable payday loans through a new online tool.
In documents seen by The Sun, the payday lender’s administrators say they’ll be launching an online tool in April to make it easier for people to submit claims.
Alamy Wonga’s administrators are launching a tool next month to make reclaiming easier
They say they’re currently receiving around 100 to 200 complaints a day with 25,000 received since the firm went bust in August 2018.
And that’s on top of the 24,000 already on Wonga’s books when the firm went under.
They couldn’t tell us how many customers they think may be entitled to compensation but they say that given Wonga had 2million UK customers it will be “significantly higher” than the current 49,000 claims.
Debt expert Sara Williams, a debt advisor at charity Citizens Advice who also runs the Debt Camel blog, reckons some 100,000 people may be due compensation.
How to claim compensation from payday lendersIF you think you are owed compensation from a payday lender then here’s how to claim according to money blogger DebtCamel:You’ll need to prove that you couldn’t afford to take out the loan at the time that you borrowed it. If having the loan meant that you couldn’t pay your bills or other debts then you were irresponsibly lent to.
You may also me entitled to compensation if you had any late repayments, or if you took out back to back loans because this shows that you really couldn’t afford to take out a new one.
Look back through your emails, bank statements and credit report for evidence.
You’ll need to write a formal complaint letter to each lender explaining how you were irresponsibly lent to and include the evidence.
You’ll need to cite “unaffordable loans” and ask for a refund of the interest and charges you paid, as well as the 8 per cent Financial Ombudsman Service interest on top.
Make copies of all of the evidence before sending in case anything happens to them.
Also ask for the loan to be removed from your credit record.
You can find a letter template here.
Wait up to eight weeks to hear back from your lender. If you’re not happy with the answer, or they don’t get back to you, contact the Financial Ombudsman Service – although be aware that the Ombudsman can only look into complaints about lenders that are still operating.
How will the tool work?
To use the tool, borrowers will be asked to provide the contact details associated with their Wonga account.
If the details match the customer information administrator Grant Thornton holds, then you’ll get confirmation that your claim has been received and will be assessed.
This will replace the current need to email or phone in with complaints.
Grant Thornton says it will contact all past and present Wonga customers to tell them when the tool is live.
You won’t need to resubmit a complaint if you’ve already done so – it will just be for new claimants.
What the tool will then do is work out if you may have a claim. The administrators say this will be based on the following factors:
The loan’s value compared to your reported income at the time
The length of time you had the loan for
The number of loans you took out – specifically whether you repeatedly borrowed without abreak
And affordability factors, such as whether you were in debt to Wonga or had reported hardship.
Is the tool fair?
The administrator believes its new tool will be “fair and reasonable” and told The Sun that it’s been designed to meet relevant legal and statutory requirements.
It also says it will be following the Financial Ombudsman Service’s example by allowing claims to be made going back further than six years.
In this scenario, older complaints can be considered if the borrower only realised there was a problem within the past three years.
When Wonga went bust, the Ombudsman had 7,000 complaints about the firm (now part of the 49,000 figure) which it had to forward on to the administrators.
More recently, the Treasury Committee called on the Government to intervene to help those Wonga customers whose complaints could no longer be looked at by the Financial Ombudsman Service.
Alamy Wonga went bust in August 2018 leaving thousands of compensation claims waiting to be dealt with
If you don’t agree with the outcome of the tool or you think you should get more compensation than you’ve been awarded you can submit further evidence and ask for the claim to be reassessed.
Ms Williams said: “With 49,000 complaints already, the administrators will be sending out emails to all Wonga’s old customers asking if anyone else wants to submit a complaint.
“And they are making it very easy to do this, so no-one needs to use a claims company. I expect there will be over 100,000 complaints in the end.
“It’s also good news that the administrators will be considering refunds on Wonga loans that are more than six years old.
“This is what the Financial Ombudsman Service thinks all payday lenders should be doing.”How much compensation will I get and how long will it take?
How much compensation you’ll get depends on your circumstances.
One dad we spoke to was refunded more than £3,750 by Wonga, including interest and late payment fees, after he was given a £600 loan he couldn’t afford to repay.
But the administrators warn that because Wonga doesn’t have enough cash, claims are unlikely to be paid in full.
It’s also too early to say how long it will take for claims to be looked into but the likelihood is that it will be at least a few months.
SUN SAVERS Prepare for summer with our hottest deals plus get FREE Alton Towers tickets MUM-BER ONE M&S cafe is doing afternoon tea for two with FREE Prosecco for £16 RARE DEAL Iceland is selling FOUR meat joints for £10 THRILL SEEKER How to hack your day at Alton Towers with Sun Savers’ tips FEEL THE HEAT Poundland is selling a portable fold-up BBQ for £5 DINNER WINNER Co-op’s £5 meal deal feeds a family of four – and saves you £6
Here’s everything you need to know about Wonga’s administration and how to claim compensation.
Wonga fined £2.6m for fake legal threats
We pay for your stories! Do you have a story for The Sun Online Money team? Email us at email@example.com